Weekly Commentary 10/18/15

Recent weak economic data have confirmed everyone's worst fears: The global growth is slowing down. Walmart was a big wakeup call to all retailers that costs are an important variable in e-commerce. Retailers, health facilities and companies like Netflix will announce many payments issue this month due to recent changes in credit card and medical billing transitions.

Not to be overlooked earlier this week was the recent development of the Trans-Pacific Partnership agreement between 12 countries that account for 26% of global trade, including the U.S. and Japan. This will gradually lower trade barriers as well as set common standards between countries for trade, investment and labor. This is certainly exciting news since this promotes global trade, resulting in a more prosperous future.

Even though the S&P 500 was up this week, we would not expect this risk on rally to last for much longer as the bulk of earnings are released next week. We expect instability to persist as many high-quality stocks continue to sell off on non-fundamental weakness since August.

Travel Plans Anyone?

On another note, if you have any pending vacation plans for this year outside of the U.S., particularly Europe, now would be the time to go. The strong U.S. dollar has resulted in major savings when traveling to countries such as Spain and Greece. A trip to France could now save you almost 25% today versus this time last year. Changes in foreign currencies can be challenging for businesses but can be a great blessing for consumers who enjoy traveling.

At the time of this commentary Vijar Kohli, his family and/or clients of Golden Door Asset Management held no positions in the stocks mentioned above — although positions can change at any time.

Vijar Kohli is also the publisher of CareStocks, a newsletter focusing in on healthcare services, medical equipment, technology and real estate stocks. More information to the newsletter can be found at www.carestocks.com.